Delaware is the leading US state for company formation, administered by the Delaware Division of Corporations under the General Corporation Law (for corporations) and the Limited Liability Company Act (for LLCs). It is the default home for venture-backed technology and fintech startups because of its predictable corporate law, the specialist Court of Chancery, and no state income tax on companies that do not operate in Delaware.
Startups raising venture capital typically incorporate as a C-corporation under the General Corporation Law, while founder-operated businesses often use the limited liability company ("LLC") under the Limited Liability Company Act. A limited partnership is also available; a foreign parent more commonly forms a Delaware subsidiary than a branch.
There is no minimum capital, and no residency requirement for directors, officers, members, or shareholders — but every entity must appoint a registered agent with a physical Delaware address. A corporation files a Certificate of Incorporation (from $109) and an LLC files a Certificate of Formation ($110) with the Division of Corporations. Standard processing takes several business days, with same-day and even one-hour expedited options for additional fees.
There is no Delaware corporate income tax on companies not doing business in the state, and no state sales tax, though federal corporate income tax of 21% applies to C-corporations (LLCs are pass-through by default); the Internal Revenue Service ("IRS") is the federal authority. Corporations file an annual report and pay franchise tax of at least $175 (plus a $50 report fee) by 1 March, while LLCs pay a flat $300 franchise tax by 1 June. Following a March 2025 FinCEN interim rule, US-formed entities are currently exempt from federal beneficial-ownership (Corporate Transparency Act) reporting, and Delaware maintains no public beneficial-owner register.